The Port of Houston: Can it handle growing ship traffic due to rising LNG exports?

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On November 10, 1914, workers finished the Houston Ship Channel, which ran 52 miles upstream of Galveston, Texas. There was a large celebration with a 21-gun salute, which featured a cannon fired remotely from Washington D.C. by President Woodrow Wilson. Aggressively pushed by U.S. Representative Tom Ball – who the city of Tomball is named after –  the channel was an answer for the growing commerce that Texas and Houston was experiencing with the discovery of oil at Spindletop and expanding rice-crop yields.

Fast forward to the present day, and Port Houston is one of the world’s busiest ports and is the number one U.S. port in foreign tonnage. Martin Associates reported in a 2014 study that 1.1 million jobs were related to the ship channel. Also in 2014, the ship channel’s economic impact was more than $264.9 billion for Texas and contributed more than $5 billion in state and local taxes.

However, the consulting firm Poten & Partners doesn’t think the Port of Houston is ready to handle the growing surge in traffic from the boom in LNG exports.

Because of the $5.3 billion expansion of the Panama Canal, experts foresee 550 LNG tankers moving through the canal by the year 2021. Add to that roughly 20 more proposed LNG-export terminals on the Gulf Coast, and it’s easy to see the worry about traffic jams of massive tankers in the Houston Ship Channel.

A senior advisor at Poten & Partners, Gordon Shearer stated, “A lot of waterways in the Gulf aren’t ready for prime time. Everything is going into a very concentrated strip of coastline.”

One major concern for the Port of Houston is weather. Fog and storms cause delays in the ship channel regularly, forming traffic jams for the lumbering LNG tankers. Eight Category 3 or stronger hurricanes have hit Galveston County since 1900, and the Gulf Coast gets hit by more tropical storms than any other U.S. coast. This obliviously raises concerns on the effect of the hurricane season on the shipping lanes for the Gulf Coast and the Port of Houston.

But according to president of Pan Eurasian Enterprises Inc., Zach Allen, “Every gas export project has to undergo a suitability study by the Coast Guard, which takes weather and traffic into consideration.” While weather is a major concern with the Port of Houston and its fellow Gulf Coast ports, safety and viability are always taken into consideration.

In response to Poten & Partners, Channing Hayden – the director of navigation for the neighboring Port of Lake Charles – stated, “Poten is being overly pessimistic.” He also confirms that his port can handle the increase in traffic.

Other parts of the country oppose LNG and other energy projects, leading to continuing energy development primarily along the Gulf Coast. “The Gulf Coast is the only section of the country that welcomes the petrochemical industry. This is where the petrochemical industry is, it is where all the pipelines converge, it is the logical place to put it,” Hayden said.

Poten & Partners think that the Port of Houston and other Gulf Coast ports aren’t ready for prime time, but the Houston Ship Channel has been in business for over a century and still manages to grow and become more efficient. Texas will always be ready for prime time.

Article written by HEI contributor Raymond Arrasmith.

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